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Sanchez Company engaged in the following transactions during Year 1:
- 1) Started the business by issuing $12,700 of common stock for cash.
- 2) The company paid cash to purchase $7,700 of inventory.
- 3) The company sold inventory that cost $5,100 for $10,400 cash.
- 4) Operating expenses incurred and paid during the year, $4,600.
Sanchez Company engaged in the following transactions during Year 2:
- 1) The company paid cash to purchase $11,000 of inventory.
- 2) The company sold inventory that cost $9,300 for $17,000 cash.
- 3) Operating expenses incurred and paid during the year, $5,600.
Note: Sanchez uses the perpetual inventory system.
What is Sanchez's gross margin for Year 2?
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